What has wealth management got to do with Domino’s pizza?
Innovative companies in other industries could teach wealth managers a thing or two about putting customer experience at the heart of business models
With $30tn of high net worth assets expected to pass from the older generation by 2050, the wealth industry could be about to witness one of the greatest asset transfers of all time.
Their newest clients – HNWIs under 40 – demonstrate least loyalty to financial advisers, meaning understanding how to engage clients has fresh urgency for the industry.
Innovation has seeped into every industry and raised consumer expectations about what is possible from an experiential standpoint. Naturally, client journeys are unique depending on product or service supplied, but there are commonalities among the most successful operators, regardless of the sector they operate in: creation of a tailored experience unique to client requirements; ongoing commitment to measuring, understanding and implementing on client needs and creation of a client-centric brand and culture.
Let us take a look at how three companies outside financial services are applying these attributes in new and interesting ways.
Audi
Audi realised major cities no longer provided requisite space for classical car dealership and test-drives. Their product was also increasingly customisable, offering thousands of combinations to customers. So, Audi City was created. This is an in-person 3D car dealership experience where interested buyers go to a private room with a salesperson to construct their dream car.
With digitally-powered walls where they can select every detail, customers witness their dream machine being built. This intersection of digital and physical playground has provided opportunities to connect previously distant touchpoints with customers, and pioneer a new and innovative customer experience (CX). Audi has seen a 60-70 per cent increase in new car sales.
Imagine if wealth managers tailored every part of the experience to clients’ requirements, creating a digital, almost panoramic view for each client, customising every part of their journey from communications they receive, to the way they pay fees and the solutions and services they can access.
Target
Similarly, retail behemoths such as Target in the US have realised the power of client data in creating a strong CX. So powerful has their data gathering been that they are now able to predict consumer shopping habits.
Target has developed a bespoke algorithm to predict when their customers are approaching significant milestones. For example, as a way to hook mums-to-be, Target’s analytics team studied what items expectant mothers tended to buy in the first months of their pregnancies – even before they knew they were pregnant themselves. In doing so, they created a ‘pregnancy prediction’ score. Using this score, Target was able to send customers coupons to build brand loyalty during a life-stage when shopping habits are in flux.
Imagine if wealth management clients were intelligently offered products and services based on their past product and service consumption or life events. Collating client data and leveraging it to develop a constantly updated solutions map would demonstrate to clients that their financial providers understand their needs.
Domino’s
When Dominos saw a sharp decline in sales, it decided to launch a research programme to find out why. Consumers reported displeasure with quality of ingredients in pizzas, among other factors. Consequently, Dominos took to social media, creating a hashtag campaign where they asked – “What is wrong with the Dominos’ pizza?”
Customers appreciated their openness and responded with constructive feedback. Dominos changed its recipes and integrated a ‘pizza tracker’ available online and by app. Sales rocketed. As if to emphasise this, its share price has risen from $2.83 in 2008 to $70 in 2014. Imagine if wealth managers were completely transparent with clients about room for improvement in services and products they offered, and adapted on a case-by-case basis.
Why are these organisations so far ahead? The answer is they have formal CX initiatives, using research to develop solutions and constantly evolving service propositions. Just 37 per cent of firms globally have a CX programme in place.
Clients perceive CX research and development to be of significant value and a clear sign that the firm cares about them and their opinions. It is time wealth managers began their own CX journeys.
Laura Cavaciuti is an analyst at wealth management think-tank Scorpio Partnership
